Austerity brings extremism: why the welfare state is the key to understanding the rise of Europe’s far right

The recent Greek election has resulted, once again, in a
coalition government between the far left Coalition of the Radical Left
(SYRIZA) and the far right Independent Greeks (ANEL). What has attracted less
media attention so far, however, is the striking result for the neo-Nazi Golden
Dawn which increased its share of the vote from 6.28 to 6.99%, gaining 18 seats
in a parliament of 300, and remaining third strongest party. This indicates
that the Golden Dawn remains a considerable presence in Greek politics since
its first entry in the Greek parliament in 2012. And, it is a striking resultfor a party that is not only extreme, violent, and
espouses Nazi
ideology, but is also currently on trial for maintaining a criminal
organization. Only a couple of days prior to the election, the party’s leader
publicly accepted “political responsibility” for the murder of left-wing
activist Pavlos Fyssas.

But the rise and resilience of far right parties is not
confined to Greece. While neo-Nazism is indeed a more isolated phenomenon, the
far right more broadly- i.e. parties that centre their attention on nationalism
and xenophobia - is becoming increasingly popular across Europe. In the 2014
European Parliament elections, four far right parties received more than 20% of
the votes cast: Austria’s FPÖ, Denmark’s DF, Britain’s UKIP and the French FN.
Several others received over 10% of the votes cast including the Dutch PVV, the
True Finns, and Hungary’s Jobbik. A number of these parties are also faring
quite well in their domestic electoral arenas, for instance the French FN in
2012, the Austrian FPÖ in 2013, and the DF in Denmark as well as UKIP in the UK
in 2015.

The most popular explanation for the rise of the far right in
Europe is the on-going economic crisis. This answer has both historical and
theoretical appeal. Historically, the rise of Nazism in interwar Europe
followed the 1929 major financial crash. Theoretically, economic crises are associated
with the rise of the far right because the dispossessed are more likely to punish
the mainstream and opt for extreme or anti-establishment parties.

But the crisis is, at best, only part of the story.Unemployment rates do not correlate with
levels of far right support.While
Greece, which does have high levels of unemployment and suffered greatly from
the crisis, did experience the rise of the Golden Dawn, other countries that
have suffered from the crisis including Spain, Portugal and Ireland have not
experienced a similar rise: Spain 2000 and National Democracy (DN) have remained
marginal in Spain, the same is the case for the Portuguese National Renovator
Party (PNR), and there is no far right party in Ireland. On the other hand, countries
that have not experienced the worst of the crisis and generally have lower
levels of unemployment, such as Britain, France, and Denmark, are experiencing
a rise in far right party support.

The problem with this explanation is therefore that it is
not consistent with patterns of far right party performance across Europe. This
is because it is missing a crucial piece of the puzzle: welfare state policies
mitigating the risks and costs that an economic crisis imposes on individuals. Ironically,
it seems that welfare cuts, employed to tackle Europe’s economic crisis, are to
blame for a broader political crisis, where the far right is flourishing.

In other words, austerity breeds right-wing extremism and
this why: The link between an economic crisis and far right support is the labour
market insecurity experienced by the middle class. When a crisis hits, those
who have a job fear that they will lose it. Those who don’t have a job (or
those who do lose it) fear that they will have no safety net or alternative
means of subsistence. The greater the risks and costs of unemployment arising
from the crisis the greater the insecurity. And in turn, the greater the
insecurity, the greater the likelihood for people to punish the mainstream and
reward far right parties.

One reason is that these parties pledge to limit foreigners’
access to jobs, thus appearing to be responding to increasing insecurity. Another is that these parties’ authoritarian vision
of order is appealing in a context where economic malaise is having a
disorderly effect on people’s lives.Finally,
far right populist rhetoric is appealing because mainstream parties take the
bulk of the blame both for the crisis itself and for inadequate policy
responses to it.

The welfare state, therefore, is the key to understanding
the rise of the far right as well as its varied performance
across Europe: The extent of insecurity that people experience as a result
of the crisis is largely determined by how protective welfare state
institutions are. People fear losing their jobs less when job dismissal
regulations protect them from redundancy. And those who do lose their jobs
suffer less from this loss when unemployment benefits are more generous. A rise
in unemployment, therefore, is morel likely to lead to far right party support
when job dismissal regulations are low and unemployment benefits not generous.

This helps explain what happened in Spain and Portugal where
unemployment has increased but the far right has not emerged. Both countries
have high unemployment
benefit replacement rates, and job
dismissal regulations for those in permanent contracts are also comparatively
high. By contrast, Greece and the UK, which have seen their far right party
support increase, have much lower
replacement rates. The UK also has one of the lowest employment protection
legislations in Western Europe.